3R.epul.

llic of tbe ~bilippines

~upreme QCourt
Jffilanila

SECOND DIVISION
LINO DOMILOS, G.R. No. 207887
Petitioner,
Present:

PERLAS-BERNABE, S.A.J,
Chairperson,
- versus - HERNANDO,
ZALAMEDA,
ROSARIO, and
MARQUEZ, JJ.

SPOUSES JOHN AND DOROTHEA Promulgated:

PASTOR, AND JOSEPH L.
PASTOR,
Respondents.

x----- ----------------------------

DECISION

HERNANDO, J.:

This petition for review on certiorari 1 under Rule 45 of the Rules of Court
assails the March 26, 2013 Decision2 and June 26, 2013 Resolution 3 of the Court
of Appeals (CA) in CA G.R. CV No. 89201, which affirmed the September 21 ,
2006 Decision4 and January 22, 2007 Resolution5 of the Regional Trial Court
(RTC), Branch 61 of Baguio City in Civil Case No. 1784-R, finding the spouses
John and Dorothea Pastor (spouses Pastor), and Joseph L. Pastor (Joseph)
(collectively, the Pastors) to be the rightful owners of the subject properties.

1
Rollo, pp. 6-18.
Id. at 20-35. Penned by Associate Justice Ange lita A. Gacutan and concurred in by Assoc iate Justices
Fernanda Lampas Peralta and Francisco P. Acosta.
3
Id. at 37-38.
4
Records, pp. 799-808.
5
Id. at 8 18-819.
Decision 2 G.R. No. 207887
•

The Antecedents:

The history of this long-running case began in 1953 when Victoriano

Domilos (Victoriano) acquired possession over a parcel of land along Kms. 4-
5, Santo Tomas Road, Baguio City, measuring approximately 15,745 square
meters (sq.m.) in size. 6 In 1974, Sergio Nabunat (Nabunat) and his family built
a shanty on the land and resided therein for three months. 7

In February 197 6, Victoriano transferred all his rights over the property to
his son, petitioner Lino Domilos 8 (Lino). A month later or in March 1976,
Nabunat and his family, including his mother-in-law, Can-ay Palichang9
(Palichang), returned to the subject property and constructed a house thereon
without Lino's consent. 10 This prompted Lino to file a complaint for forcible
entry 11 against Nabunat with the City Court of Baguio (now Municipal Trial
Court in Cities) (MTCC), Branch 4, docketed as Civil Case No. 5893.

On November 17, 1977, the City Court of Baguio rendered a Decision 12 in

favor of Lino, ordering Nabunat and the members of his family to vacate the
subject property and remove his house therefrom, among others.

The Court of First Instance (now the RTC), Branch 4, in a Decision13 dated
January 6, 1979, sustained the Decision of the City Court of Baguio. A Writ of
Execution and Alias Writs of Execution were issued, and Nabunat's house was
demolished. 14

Several years after, on November 17, 1986, Lino and Palichang entered
into a compromise agreement, 15 dividing the property among five different
parties, to wit:

NOW, THEREFORE, for and in consideration of this noble purpose and

objective, both parties do hereby agree, as they have in fact agreed to enter into
this Compromise Agreement under the following terms and conditions, to wit:

a. That there is hereby reserved for Mr. LINO DOMILOS a portion with an
area of THREE THOUSAND (3,000) SQUARE METERS, more or less, which
portion is now occupied and/or claimed by Atty. Jasa, Mr. Federico Yu and one
Mr. Reyes.

6
Rollo,p.21.
7
Id.
8
Spelled as Damilos in some documents.
9 Spelled as Pallichang in some documents.
10 Rollo, p. 2 I.
11
Records, pp. 574-577.
12
Id. at 584-587.
13
Id. at 581-A
14 Id ..
15
Id. at 565-567.
Decision 3 G.R. No. 207887

b. That the remaining area of TWELVE THOUSAND (12,000) SQUARE

METERS shall be divided as follows:

aa. THREE THOUSAND (3,000) SQ. M. shall be owned and possessed by Mr.
LINO DOMILOS;

bb. THREE THOUSAND (3,000) SQ. M. shall be owned and possessed, as in

fact, had already been occupied and possessed by. MRS. CAN-A Y
PALLICHANG, maintaining as much as possible, the same area she had been
occupying and possessing for quite a long time already.

cc. THREE THOUSAND (3,000) SQ. M. shall be owned, occupied and

possessed by SERGIO NABUNATand wife SOLEDAD PALLICHANG which
should be adjacent and contiguous to the area occupied and owned b; MRS.
CAN-AY PALLICHANG;

dd. THREE THOUSAND (3,000) [SQ. M.) are hereby transferred and conveyed
to A TTY. BASILIO P. RUPISAN, [F]ilipino, oflegal age, married and a resident
of Bayombong, Nueva Vizcaya to answer for lawyer's fees and other obligations
to Victorino S. Alvaro and Col. Rufo Pulido and other persons, which shall be
segregated from the southwestern portion of the lot.

The areas to be segregated by a duly-licensed Geodetic Engineer and the exact

location of these areas shall be delineated by a separate paper signed by the
parties, the expenses to be shared pro-rata.

ee. The parties do hereby agree to dismiss or drop all related cases filed in court
or in any office or agency of the government, either originating from their dispute
over [the] land or not where anyone of them is a plaintiff or a defendant, to the
end that their dispute involving them or their relatives over this land will be
completely settled. 16

From the years 1987 to 1989, Lino, Nabunat and Palichang sold different
p011ions of the property to different parties. Lino sold a 600-sq. m. portion of
his share to Emerita Limos and a 1,150-sq. m. portion to Rolando Garcia. The
Nabunats sold a 250-sq. m. portion of their share to Alejandre Layagan; a 375-
sq. m. portion to Romulo B. Tuscano; a 232-sq. m. portion to Dorothea L.
Pastor, one of the herein respondents; and a 600-sq. m. portion to Joseph L.
Pastor, another respondent, and Jacqueline and Johneva Pastor. 17

On May 9, 1989, Lino sought to execute the November 17, 1977 Decision
of the City Com1 of Baguio by filing a motion for issuance of 4 th alias Writ of
Execution on Special Order of Demolition and to restore physical possession of
land to Lino 18 (motion for 4 th Alias Writ of Execution) against Nabunat.

On May 15, 1989, Lino and Palichang executed a revocation and

cancellation of compromise agreement, 19 which states in part:

1<, ld. at 565-566.

17
Rollo, p. 23.
1
~ Records, pp. 368-369.
19
Id. at 380.
Decision 4 G.R. No. 207887 '

NOW, THEREFORE, WE LINO DOMILOS AND CAN-AY

PALLI CHANG by virtue of these presents hereby CANCEL, ANNUL,
REVOKE AND MAKE VOID said Compromise Agreement and all matters
therein be clarified between us as previously intended to do so. 20

The following day, the City Court ofBaguio granted Lino's motion for 4th
Alias Writ ofExecution. 21 On May 20, 1989, the corresponding 4th Alias Writ
of Execution on Special Order for Demolition of Improvement22 was issued
resulting in the demolition of some of the properties of the spouses Pastor.

Thus, on June 26, 1989, the spouses Pastor and Joseph filed a suit for
annulment of Order, 4th Alias Writ of Execution, revocation of compromise
agreement, recovery of possession, damages, with petition for issuance of
preliminary prohibitory and mandatory injunction (annulment of order) against
Lino, Palichang and Soledad Nabunat (Soledad) before the RTC, Branch 3,
Baguio City, claiming ownership and possession over the disputed properties,
and sought annulment of the order granting the Writ of Execution and the
corresponding 4th Alias Writ of Execution. The case was docketed as Civil Case
No. 1784-R. 23

The Pastors claimed that Lino wrongfully sold a portion of his property
even ifhe had none left to sell, according to the compromise agreement. Thus,
to get rid of the other lawful owners, Lino revoked the compromise agreement
to deliver the disputed properties to the buyer. 24

On the other hand, Lino denied all material allegations. He averred that
the spouses Pastor failed to include indispensable parties like the judge and
sheriff; and that the spouses Pastor are not parties to the compromise
agreement. As such, they have no legal personality to sue Lino for revoking
the same. Palichang and Soledad similarly denied the allegations and asserted
lack of cause of action. They also prayed for payment of damages. 25

Subsequently, the spouses Pastor amended their complaint to implead the

judge and the sheriff. 26

On December 5, 1991, the RTC issued an Order27 granting the motion for
leave to amend complaint to implead additional defendants and admitting the
spouses Pastor's amended complaint. 28 On June 10, 1992, Atty. Basilio
Rupisan, one of the owners of the property pursuant to the compromise

20 Id.
21
Id.at581-A
22
Id. at 377A.
23
Rollo, p. 25.
24
Records, pp. 1-9.
25
Rollo, pp. 25-26.
26
Records, pp. 132-133.
27
Id. at 155.
,s Id.
Decision 5 G.R. No. 207887

agreement, also filed civil cases 29 against Lino and moved for its joint hearing
with the case of spouses Pastor.

Ruling of the Regional Trial Court:

On September 21, 2006, the RTC rendered its Decision, 30 the dispositive
portion of which reads:

WHEREFORE, judgement is rendered as follows:

In Civil Cases No. 1784-R, entitled Sps. John Pastor and Dorothea Pastor
and .Joseph Pastor vs. Lino Domilos, Can-ay Palichang and Soledad P. Nabunat,
the Court finds in favor of [Sps. Pastor and Joseph Pastor] and against [Lino,
Palichang and Nabunat] declaring the [Sps. Pastor and Joseph Pastor] to be the
rightful owner of the following properties:

a. A parcel of land situated in Res. Sec. "J" Lot 12, bounded by Lot 13, Lot
11 and Lot 4-A, containing an area of TWO HUNDRED THIRTY-TWO (232)
Square Meters, more or less;

b. A parcel of land situated in Res. Sec. "J" of Lot 13, bounded by Lot 14,
10 and Lot 12, containing an area of TWO HUNDRED TWENTY-NINE (229)
Square Meters, more or less;

c. A certain parcel of land destined for residential purposes, situated at Sto.

Tomas Road, Baguio City, located at Res. Sec " J" Baguio City, containing an
area of SIX HUNDRED (600) SQUARE METERS, more or less, which parcel
of land is bounded on the North by property sold to Lt. Asta and Company, on
the East by the property owned by Mr. Lino Domilos; on the West by our existing
property and on the South, by a titled prope1ty.

[Lino, Palichang and Nabunat] are hereby ordered to surrender peaceful

possession of the above-mentioned properties to the [Spouses Pastor and Joseph
Pastor] being the necessary consequence of the determination of ownership by
the court.

Civil Case No. 2107-R, entitled Basilio P. Rupisan [v.] Lino Domilos, Can-
ay Palichang, Soledad P. Nabunat, Sps. Myrna M. Gatchalian and Willie A.
Gatchalian and Regino B. Chan, is DISMISSED.

SO ORDERED. 31

On January 22, 2007, the RTC resolved Lino's motion for

reconsideration,32 to wit:

WHEREFORE, the dispositive portion of the Decision, as it concerns Civil

Case No. 1784-R, is hereby modified to read as follows:

29
Id. at 164.
30
Id. at 799-808.
31
Id. at 807-808.
32
Id. at 809-812.
Decision 6 G.R. No. 207887

The Court finds in favor of [the Spouses Pastor and Joseph Pastor] and
against [Lino, Palichang and Nabunat] and declaring [the Spouses Pastor and
Joseph Pastor] to have acquired lawful rights over the following properties:

a. A parcel ofland situated in Res. Sec "J" Lot 12, bounded by Lot 13, Lot
11 and Lot 4-A, containing an area of TWO HUNDRED THIRTY-TWO (232)
Square Meters, more or less;

b. A parcel of land situated in Res. Sec. "J" of Lot 13, bounded by Lot 14,
10 and Lot 12, containing an area of TWO HUNDRED TWENTY-NINE (229)
Square Meters, more or less;

c. A certain parcel of land destined for residential purposes situated at Sto.

Tomas Road, Baguio City, located at Res. Sec. "J" Baguio City, containing an
area of SIX HUNDRED (600) SQUARE METERS, more or less, which parcel
of land is bounded on the North by prope1iy sold to Lt. Asto and Company, on
the East by the property owned by Mr. Lino Domilos; on the West by our existing
property and on the South, by a titled property.

In relation to the above modification, [Lino, Palichang and Nabunat] are

hereby ordered to surrender peaceful possession of the above-mentioned
properties to the [Sps. Pastor and Joseph Pastor] having acquired rights thereto
by virtue of a valid conveyance.

SO ORDERED. 33

Ruling of the Court of Appeals:

The CA sustained the RTC and ruled m favor of the Pastors. The
dispositive portion of the CA Decision reads:

WHEREFORE, the appeal is DISMISSED. The assailed Decision dated

September 21, 2006 and the Resolution dated January 22, 2007 of the Regional
Trial Court of Baguio City, in Civil Case No. 1784-R, are AFFIRMED. Costs
against defendants-appellants.

SO ORDERED. 34

Thus, this petition for review on certiorari. 35

Issues:

1. WHETHER OR NOT THE [RTCJ DECISION AND AFFIRMED BY

THE [CA] IS VALID WHEN IT FAILED TO STATE THE LAW AND
JURISPRUDENCE TO SUPPORT ITS JUDGMENT AS REQUIRED IN
SECTION I, RULE 36 OF THE RULES OF COURT AND ARTICLE VIII,
SECTION 14 OF THE 1987 CONSTITUTION.

33
Id. at 828-829.
34
Rollo, p. 34.
35
ld.at6-J8.
 Decision 7 G.R. No. 207887

2. WHETHER OR NOT THE COMPROMISE AGREEMENT

ENTERED UPON BY [DOMILOS] WITH PALICHANG AND NABUNAT,
PENDING A CASE IN THE [RTC], WHICH WAS NOT EVEN SUBMITTED
FOR JUDICIAL APPROVAL, CAN BE AV AUD SOURCE OF A RIGHT.

3. WHETHER OR NOT THE [CA] ERRED IN NOT CONSIDERING

THE JUDICIAL ADMISSIONS OF THE [SPOUSES PASTOR] AND JOSEPH
L. PASTOR WHICH CAN PROVE THAT [THEY] ARE BUYERS IN BAD
FAITH.

4. WHETHER OR NOT BUYERS IN BAD FAITH HAVE A LEGAL

AND REAL INTEREST TO VALIDLY MAINTAIN AN ACTION TO ASSAIL
THE VALIDITY OF REVOCATION AND CANCELLATION OF A
COMPROMISE AGREEMENT, NOT BEING [PARTIES] THERETO.

5. WHETHER OR NOT ARTICLE 1131 OF THE [CIVIL CODE] WAS

PROPERLY APPLIED BY THE [CAJ. 36

Our Ruling

The Court denies the petition for review on certiorari and affirms the
Decision of the CA and RTC finding the Pastors to be the rightful owners of the
subject properties.

The RTC and CA Decisions were

supported by law and
jurisprudence.

Lino contends that both the RTC and CA Decisions were in violation of
the first paragraph of Article VIII, Section 14 of the 1987 Constitution which
states:

SECTION 14. No decision shall be rendered by any coUii without

expressing therein clearly and distinctly the facts and the law on which it is based.

Lino also alleges that the RTC and CA Decisions violated Rule 36, Section
1 of the Rules of Court, 37 to wit:

SECTION 1. Rendition o,fjudgments and final orders. - A judgment or

final order determining the merits of the case shall be in writing personally and
directly prepared by the judge, stating clearly and distinctly the facts and the law
on which it is based, signed by him, and filed with the clerk of court.

The Court disagrees.

A perusal of the records of the case clearly shows that both the RTC and
the CA summarized the facts of the case on its pertinent points and backed up
their rulings and conclusion with applicable law and jurisprudence. The
36
Id. at 10.
37
1997 RULES or C IVIL PROCEDURE AS AMENDED.

71 /
Decision 8 G.R. No. 207887

pronouncement in People v. Maguikay, 38 which the CA cited as legal basis, still

holds true today:

All that [the Constitutional] provision requires is that the decision should
state the "essential ultimate facts" upon which the court's conclusion is drawn.
Courts need not discuss in their decision every evidence adduced by the parties
for many of them are not relevant to the decisive issues of fact and law involved
in the case. Indeed, a trial judge enjoys a wider latitude of determining the
material facts based on the conflicting asseverations of both parties which would
be the basis of his [or her] decision. In congruence, it is presumed that the official
duty has been regularly performed, and that all the matters within an issue raised
in a case were laid before the court and passed upon by it. 39

The purpose of Article VIII, Section 14 of the Constitution in relation to

Rule 36, Section 1 of the Rules of Court, is to inform the person reading the
decision, and especially the parties involved in the case, of how the decision
was reached by the court after consideration of the pertinent facts and
examination of the applicable laws. A decision that does not clearly and
distinctly state the facts and the law on which it is based leaves the parties in
the dark as to how it was reached. It is especially prejudicial to the losing party
who is unable to pinpoint the possible errors of the court for review by a higher
tribunal. 40

A review of both the September 21, 2006 RTC Decision and March 26,
2013 CA Decision reveals that the judgments were consistent with the purpose
of the Article VIII, Section 14 of the 1987 Constitution as both contained a
thorough summary of the antecedent facts and proceedings; a discussion of
relevant statutory provisions and jurisprudence; and a presentation of
significant documentary evidence presented by both parties. Clearly, the two
judgments were reached in the regular performance of the courts' duty and no
error can be attributed to either of the decisions.

The Pastors have a legal and real

interest in the subject properties.

The subject compromise agreement, being a contract that has the force of
law, is also governed by the requisites and principles of contracts under Title II
of the Civil Code, 41 particularly Articles 1312, 1315 and 1385, to wit:

Article 1312. In contracts creating real rights, third persons who come into
possession of the object of the contract are bound thereby, subject to the
provisions of the Mortgage Law and the Land Registrations Laws.

Article 1315. Contracts are perfected by mere consent, and from that moment the
parties are bound not only to the fulfillment of what has been expressly

38
307 Phil. 605 (1994).
39
Id. at 623.
40
See People v. Sandiganbayan, 642 Phil. 640, 649 (20 I 0).
41
See Land Bank of the Philippines v. Heirs ofSpouses Rigor-Soriano, 702 Phil. 521,530 (2013).
 Decision 9 G.R. No. 207887

stipulated but also to all the consequences, which, according to their nature,
may be in keeping with good faith, usage and law.

A1iicle 13 85. Rescission creates the obligation to return the things which were
the object of the contract, together with their fruits, and the price with its interest;
consequently, it can be carried out only when he who demands rescission
can return whatever he may be obliged to restore.

Neither shall rescission take place when the things which are the object of
the contract are legally in the possession of third persons who did not act in
bad faith.

In this case, indemnity for damages may be demanded from the person
causing the loss. (Emphasis supplied)

It is clear from the above provisions that the compromise agreement was
a contract that created real rights as it was a contract for division of property.
The third persons, the Pastors, who came into possession of the object of the
contract are thus, bound by the contract or compromise agreement.

Furthermore, rescission, or in this case, revocation or cancellation of the

compromise agreement, cannot take place because the objects of the contract
are already in the legal possession of the Pastors who did not act in bad faith.
At the time the compromise agreement was revoked by Lino and Palichang,
the Pastors were already legal co-owners of the property by virtue of a valid
sale. 42 As such, their respective shares in the disputed property may not be
validly included in the revocation of the compromise agreement without their
knowledge and consent. Although it is clear that the Pastors are not parties to
the compromise agreement, their objection to its revocation can be treated as
an adverse claim over the disputed property. 43

Lino cannot anymore move to

execute the decisions of the lower
courts.

Finally, the Court agrees with the CA when it invalidated the motion for
4 th Alias Writ of Execution. The MTCC Decision was issued on November 17,
1977 and was further appealed to the RTC, which appeal was then decided on
January 6, 1979. No appeal was further filed from 1979, thus, the R TC Decision
became final. Therefore, in accordance with Rule 39, Section 6 of the Rules of
Court,44 Lino had five years from 1979 to file a motion to execute the final
judgment. However, the records show that the motion for the 4 th Alias Writ of

42
Records, pp. 51 -56.
43 See logarta v. Mangahis, 789 Phil. 244, 252(2016).
44
Rule 39, Section 6 of the Rules of Court states:
Section 6. Execution by motion or by independent action. - A final and executory judgment or
order may be executed on motion within five (5) years from the date of its entry. After the lapse
of such time, and before it is barred by the statute of limitations, ajudgment may be enforced
by action. The revived judgment may also be enforced by motion within five (5) years from
the date of its entry a nd thereafter by action before it is barTed by the statute of limitations.
Decision 10 G.R. No. 207887

Execution was only filed with the MTCC on May 9, 1989,45 or 10 years and 4
months from the time the judgment was issued.

The RTC Decision, dated January 6, 1979, likewise attained finality when
no appeal was taken. In accordance with Article 1144, paragraph (3) of the
Civil Code, 46 Lino had 10 years from the time the judgment was issued or until
January 1989 to bring an ordinary civil action for the execution of the RTC
judgment. However, the 10 years had already lapsed by the time Lino filed the
motion for 4 th Alias Writ of Execution on May 9, 1989.

The Court agrees with the ruling of the CA, citing Terry v. People: 47

The rule is that the court could issue a writ of execution by motion within five
(5) years from [the] finality of the decision. After the lapse of this period and
before the same is barred by the statute of limitations, the judgment may be
enforced by instituting an ordinary civil action. The reason is that after the lapse
of the five-year period, the judgment is reduced to a mere right of action, which
judgment must be enforced, as all other ordinary civil actions, by the institution
of the complaint in the regular form. Such action must be filed within ten (10)
years from the date the judgment became final.

As shown by the records, the MTC rendered a Decision in the forcible entry
case on November 17, 1977. The Decision was appealed to the RTC, which
sustained the MTC in a Decision dated January 6, 1979. No further appeal was
interposed by either party, allowing the RTC Decision to attain finality. The 4th
Alias Writ of Execution, on the other hand, was issued by the MTC only on May
20, 1989. At that time, this could no longer be lawfully done as the five-year
period within which to issue an alias writ of execution by motion had already
lapsed.

Even the RTC Decision sought to be enforced became stale as more than
ten (10) years had lapsed before the 4th Alias Writ of Execution was issued. The
Sheriff could not lawfully enforce and execute such invalid alias writ of
execution. Therefore, no reversible error can be ascribed on the part of the RTC
for invalidating the 4th Alias Writ ofExecution.48

Considering the foregoing, the petition must be denied. There 1s no

reversible error committed by the CA.

WHEREFORE, the Court DENIES the petition. The March 26, 2013
Decision and June 26, 2013 Resolution of the Court of Appeals in CA G.R. CV
No. 89201 are hereby AFFIRMED.
45
Records, p. 377-A
46
Article! 144 (3) of the Civil Code states:
Article 1144. The following actions must be brought within ten years from the time the right
of action accrues:
xxxx
(3) Upon a judgment.
47
373 Phil. 444-452 (1999).
48
Rollo, pp. 33-34.
Decision II G.R. No. 207887

SO ORDERED.

~ { / I f ~ ,,__,_,_j_,--- .
RANPAULL.HERNANDO
Associate Justice

WE CONCUR:

ESTELA M. ~~ERNABE
Senior Associate Justice
Chairperson

EDA RICAR . ROSARIO

U?~~
J&ioASP.MARQUEZ
u;:ciate Justice
Decision •
12 G.R. No. 207887 •

ATTESTATION

I attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court's Division.

ESTELA ~-BERNABE
Senior Associate Justice
Chairperson

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution and the Division
Chairperson's Attestation, I certify that the conclusions in the above Decision
had been reached in consultation before the case was assigned to the writer of
the opinion of the Comi's Division.

.GESMU